The Federal Aviation Administration’s (FAA) spokesman Ian Gregor said that there are currently about 1.5 million registered drones in the nation and forecasts show that by 2025, that number will increase to three million. It’s just one reason for ETF investors to consider the ETFMG Drone Economy Strategy ETF (NYSEArca: IFLY).
IFLY seeks to provide investment results that correspond generally to the price and yield performance of the Reality Shares Drone™ Index. The index tracks the performance of the equity securities of companies across the globe and across a wide variety of industries that are actively involved in the development, research, or utilization of drones.
Per the fund’s website, IFLY was “created to provide the market with a transparent vehicle to invest in the increasingly important drone tech sector.”
Fund facts:
- The first and only ETF to target the drone ecosystem
- Industrial drone usage includes emergency services, agriculture, military, construction and real estate
- Leaders in home delivery; Amazon, FedEx, UPS are primed to roll out drone delivery service and have begun testing in various markets
- Changes in regulation has paved the way for the proliferation of drone usage
Here’s a peek inside its top 10 holdings as of Nov. 21:
- AEROVIRONMENT INC: 4.26%
- PARROT: 3.03%
- BOEING CO: 2.83%
- HONEYWELL INTL INC: 2.29%
- BAE SYSTEMS: 2.26%
- LEONARDO-FINMECCANICA SPA: 2.18%
- JABIL INC: 2.12%
- AMBARELLA INC: 2.08%
- INTEL CORP: 2.07%
- AUTONOMOUS CNTRL S: 2.02%
IFLY is up 25.16% YTD based on Yahoo performance numbers.
In order to maintain that growth, however, one thing that needs to be addressed, according to the FAA, is safety.
“The fact is that a lot of these people are coming into the drone industry with little to no prior aviation experience so they might not necessarily know what safe operations entail,” said Gregor. “It is very disconcerting because if somebody flys a drone that interferes with wildfire fighting efforts…that can literally have life and death implications. You know the fire agencies say: if you fly, we can’t.”
Safety measurements are already being taken with national events like National Drone Safety Awareness Week.
“National Drone Safety Awareness Week is designed to educate the public about drone safety by highlighting how key sectors of the drone community are engaging with the public,” an article in Government Technology said. In the latest event, “about half a dozen UAS companies and operators in the Grand Forks area came to UND to talk to the public about how their drones are utilized. The Northeast Region Unmanned Aircraft System unit also came to the event to show how law enforcement and first-responders utilize drones in their work.”
For more market trends, visit ETF Trends.
